Overview

• Maersk, the Danish shipping giant, has suspended all shipping through the Red Sea and Gulf of Aden due to escalating attacks by Iranian-backed Houthi militants.
• The U.S. Navy has been responding to attacks on commercial vessels, including the Maersk Hangzhou, as part of the U.S.-led initiative, Operation Prosperity Guardian.
• Despite U.S. efforts, the threat to global trade in the Red Sea remains high, affecting $225 billion in trade and impacting 330 vessels so far.
• More commercial ships are rerouting around the Cape of Good Hope on the southern tip of Africa, causing an increase in container rates from Shanghai.
• The situation raises the stakes for Operation Prosperity Guardian, which requires significant naval coordination and a strategy of deterrence to be successful.